FINRA Censures and Fines Dalmore Group LLC for Private Placements Rules Violations
The White Law Group is investigating potential securities claims involving Dalmore Group, Inc. (CRD No. 136352,Woodmere, NY.)
Dalmore Group, Inc. is a dually registered investment adviser and broker dealer, headquartered in Woodmere, NY. Dalmore’s primary business line is investment banking, mainly dealing with private placements investments, according to the Financial Industry Regulatory Authority (FINRA).
According to a Letter of Acceptance, Waiver and Consent posted by FINRA on March 22, 2021, the regulator has censured and fined Dalmore Group $40,000 for alleged supervisory violations in connection with private placement investments.
A broker-dealer has a duty to conduct a reasonable investigation concerning any private placement offering that it recommends and sells to its customers.
Between March 2017 and December 2018, Dalmore purportedly failed to establish and maintain a supervisory system designed to ensure that the firm complied with its due diligence obligations, in violation of FINRA rules.
For two private placement offerings that Dalmore recommended and sold to customers at that time, the firm allegedly failed to conduct and document reasonable investigations of the offerings before recommending these securities to customers, according to FINRA’s findings.
The firm purportedly failed to review any business plans or models, prospects for the industry, any existing or potential regulatory restrictions on the business and the competitive position of the issuer. Further, instead of conducting an independent investigation, Dalmore Group allegedly relied almost exclusively on documentation and information the issuers provided, according to FINRA.
As a result, the firm reportedly failed to uncover relevant information regarding the issuer. For one offering, FINRA alleged that the firm failed to identify a securities related litigation against a key director and officer of the issuer.
The firm also reportedly failed to submit required offering documents to FINRA within 15 calendar days of the date of first sale for 26 private placements, from April 2017 through February 2019.
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The foregoing information, which is all publicly available, is being provided by The White Law Group. The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois.
If you have concerns regarding investments you purchased through Dalmore Group and would like to speak with a securities attorney, please call The White Law Group at 888-637-5510.
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